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11usefulIncomeTaxDeductionsfor201516
CHARTEREDCLUB
11usefulIncomeTaxDeductionsfor201516
TheIncomeTaxActprovidesforvarious incometaxdeductionswhichcanbeclaimedatthetime
offilingofincometaxreturns.Thetotaltaxableincome(afterreducingtheincometaxdeductions
thathavebeenclaimed)wouldbetaxedaspertheIncometaxslabratesoftheindividual.
RecommendedRead:
CurrentIncomeTaxSlabRatesinIndia
ProcedureforIncomeTaxReturnefiling
TheIndianIncomeTaxDepartmentencouragesitscitizenstomakeuseofthevariousIncomeTax
Deductions,IncomeTaxExemptionsandIncomeTaxrebatesallowedundertheIncomeTaxAct
whichhelpthetaxpayerstoreducetheirtaxesinIndialegally.
RecommendedRead:HowtosaveTaxlegallyinIndia
11UsefulIncomeTaxDeductionstoSaveTaxes
TherearevariousincometaxdeductionswhichareallowedtobeclaimedbyanIndividual/HUF.
Themostusefulincometaxdeductionswhichcanbeeasilyclaimedandarehelpfulinreducing
thetaxburdenhavebeenexplainedbelow.
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11usefulIncomeTaxDeductionsfor201516
NationalSavingsCertificate
RepaymentofPrincipalonHousingLoan
PremiumonLifeInsurancePolicy
EquityOrientedMutualFunds
ContributiontoEmployeeProvidentFund
From financial year 201516 onwards, an additional deduction of Rs. 50,000 is allowed for
investment in NPS Account. This additional deduction of Rs. 50,000 is over and above the
deductionallowedtobeclaimedunderSection80CandSection80CCC.
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11usefulIncomeTaxDeductionsfor201516
Inotherwords,thecumulativetotaloftheseshouldnotexceedRs.2,00,000.
5.SECTION80CCG:DEDUCTIONFORINVESTMENTMADEUNDER
ANEQUITYSAVINGSCHEME
This deduction is also known as the Rajiv Gandhi Equity Savings Scheme. This income tax
deductionisallowedtoanindividualwhohasinvestedinlistedsharesorlistedmutualfundsina
givenfinancialyear.Thedeductionallowedforsuchaninvestmentwouldbe50%oftheamount
investedsubjecttoamaximumofRs.25,000only.
Thisdeductionhoweverisonlyforfirsttimeinvestorsandtheinvestmentalsohasalockinperiod
of3yearsfromthedateofacquisition.
RecommendedRead:DeductionforInvestmentinRajivGandhiSavingScheme
6.SECTION80D:DEDUCTIONFORPAYMENTOFMEDICAL
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11usefulIncomeTaxDeductionsfor201516
INSURANCEPREMIUM&HEALTHCHECKUP
If an individual/HUF has made any payment for medical insurance premium for himself, spouse,
dependent children, he would be allowed to claim an income tax deduction for the same. The
deductionallowedunderthissectionvariesdependingonwhetherthepersoninsuredisasenior
citizenoranonseniorcitizen.
Ifanyamounthasbeenpaidforpreventivehealthcheckup,deductionwouldbeallowedforsuch
paymentaswell.
RecommendedReadSection80D:DeductionforMedicalInsurance&HealthCheckup
7.SECTION80DD&SECTION80U:INCOMETAXDEDUCTIONFOR
DISABILITY
IftheindividualhimselfisdisabledhewouldbeallowedadeductionunderSection80DDandin
caseanydependentfamilymemberoftheindividualisdisabled,hewouldbeallowedadeduction
underSection80U.
ThedisabilitiesforwhichthedeductionsunderSection80DD&Section80Uareallowedhavealso
beendefinedintheincometaxact.
RecommendedRead:AllaboutDeductionforDisabilityunderSection80DD&Section80U
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11usefulIncomeTaxDeductionsfor201516
income tax deduction is that there is no maximum limit on the amount of deduction that can be
claimed.
This Deduction is not only allowed for Education in India but also allowed for Education outside
Indiaaswell.
RecommendedRead:Section80E:DeductionforRepaymentofInterestonEducationLoan
11.INCOMETAXDEDUCTIONFORRENTUNDERSECTION80GG
IfanIndividualhaspaidHouseRentandhehasnotclaimedincometaxdeductionsfortheRent
paid under any other sections of the income tax act, he can claim a deduction under Section
80GG.
In other words, a salaried employee who has not availed of the HRA Exemption or any other
personwhohasnotclaimedexpensesforrentpaidunderanyothersectionofIncomeTaxAct,is
allowedadeductionunderthissectionsubjecttothelimitsprescribedunderSection80GG.
RecommendedRead:AllaboutDeductionforRentpaidunderSection80GG
KaranBatra
APersonalFinanceenthusiast,Karanisthefounderofcharteredclub.comand
lovestodiscussaboutMoneyrelatedmatters.
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11usefulIncomeTaxDeductionsfor201516
T RENDING
TaxAdvice:7Thingstodobefore31stMarch
HowtoopenNPSAccountonlinein30Minutes
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11usefulIncomeTaxDeductionsfor201516
Budget2016UpdateAddl.BenefitofRs50000forHomeLoan
KrishiKalyanCess@0.5%onalltaxableservices
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11usefulIncomeTaxDeductionsfor201516
ProcedureforServiceTaxRegistrationOnline
CHARTEREDCLUB
2 0 1 5 C H ARTER ED C L U B.AL LR IGH TSR ESERVED
ABOUTUS CLIENTS WEAREHIRING ADVERTISE CONTACTUS
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